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Rice packing line for export at Trung An High-Tech Agriculture Joint Stock Company. Photo: provided by the company

Worn out because of Covid-19

In a recent announcement to shareholders, Ho Chi Minh City Technical Infrastructure Investment Joint Stock Company (CII) shared on the effects of the Covid-19 pandemic on CII's operations. Specifically, for traffic toll collection activities, the company has stopped collecting tolls at the request of competent State agencies. This toll stop will not affect the efficiency of BOT projects in the long term, but will directly (in a downward direction) affect CII's revenue and profit in the fiscal year 2021.

In addition, the implementation of distancing and stopping the construction of construction works at the request of competent State agencies has seriously affected CII's business activities in real estate, especially for legal completion and construction progress. Therefore, the accounting of revenue and profit as planned in 2021 is almost mandatory to switch to accounting in 2022.

In a recent seminar, Nguyen Phuong Lam, Director of VCCI Can Tho shared statistics from VCCI Can Tho showing that in just three months from June to August 2021, there were more than 10,000 businesses in the area. The Mekong Delta region stopped operating, including thousands of businesses waiting to complete termination procedures. This number is 10 times higher than in the first five months of the year.

In seafood, many seafood processing factories in the Mekong Delta have had to suspend operations in the past two months due to failure to meet the requirements for disease prevention or not to meet the "three on-site" requirements. To maintain operations, Sao Ta Food Joint Stock Company (FMC) had to maximise internal health work.

According to Ho Quoc Luc, Chairman of the Board of Directors of FMC, in the first half of August, the company only had 40% of employees to implement "three on-site", by the second half of the month, the labor rate increased to 60% because Soc Trang province expand the safe zone. However, because specialised workers who do many items in many factories are concentrated in 2 factories with fewer items, productivity is reduced and the rate of defective goods increases. Accordingly, FMC's shrimp production in August was only 68% of the same period in 2020, reaching 1,618 tonnes; and shrimp consumption was only 44% over the same period last year, reaching US$ 11.1 million.

The textile sector has also been hit hard. Typically, Thanh Cong Textile - Investment - Trading Joint Stock Company suffered a loss after tax of US$ 282,425 in August 2021, after having decreased in July 2021. Due to the complex pandemic situation, Garment Thanh Cong had to implement distance work in August, causing labor productivity in the garment industry to fall short of the plan. In addition, operating costs under the "three on-site" method are high, leading to low gross profit margin and loss of profit after tax this month.

Production activity decreased, so electricity consumption also decreased, affecting the business activities of power plants. EVN Genco 3 reported the total production output in August reached 1.96 billion kWh, equivalent to 71% of the monthly plan, down nearly 24% compared to July and down nearly 23% from the same period last year. In the first eight months of 2021, EVN Genco3's electricity output decreased by 9% over the same period last year, reaching 20.5 billion kWh, equivalent to nearly 63% of the whole year plan.

Power output in August 2021 of PetroVietnam Power Corporation (PV Power) also decreased by 20% over the same period last year, hitting only 964 million kWh. Therefore, August revenue of PV Power decreased by 2% compared to the same period in 2020, at VND 1,813.6 billion, only reaching 86% of the plan. Accumulated in the first eight months of 2021, total output reached nearly 11.8 billion kWh, down 16% compared to the same period in 2020, revenue reached 20,082 billion dong, equivalent to the same period last year.

There are still bright spots

Although the general situation is difficult, there are still firms that have recorded quite positive results. Trung An High-Tech Agriculture Joint Stock Company estimates the revenue of the third quarter of 2021 will reach about VND 500 billion, down 8% compared to the same time in 2020, but profit increased by 66% compared to the same period last year and doubled compared to the second quarter of 2021, reaching VND 40 billion. According to the company's explanation, this is due to a shift in strategy to focus on exporting high-grade clean rice with higher export prices. In addition, by exploiting and cultivating the entire area of ​​Kien Giang sample field according to new processes, improving techniques of tillage, irrigation, spraying, sowing, etc., it helps to cut input costs and increase the yield of harvested rice.

Trung An Company said that in the coming time, the company will participate in bidding for many export packages of great value to Asian markets such as South Korea, Malaysia, the Philippines, etc. Particularly for the European market, from June, the company opened a representative office in Hamburg, Germany for the European Union customers to access the company's products more conveniently. In fact, over the past two months, the number of customers in Europe coming to buy the company's products has increased quite a lot.

Another firm operating in the shipping industry also achieved positive results thanks to the general positivity of the shipping industry over the past time. PetroVietnam Transportation Corporation (PVTrans) estimated revenue of 4,930 billion dong in the first eight months of 2021, up 103% from the same period in 2020 and pre-tax profit of about 621 billion dong, up 119%. Thus, the company has completed 82% of the revenue target and exceeded 24% of the target of pre-tax profit for the year of 2021.

This positive result, according to PVTrans, is due to the company's strategic orientation on fleet rejuvenation, transport capacity improvement, and competitive advantages in the market. Specifically, from the beginning of the year until now, the company has received three new ships. The company also plans to invest in and improve the capacity of the gas tanker fleet with large VLGC and chemical tankers and VLCC-sized crude oil tankers in the international market. The company plans to invest in 15 more ships, including four ships at the parent company and 11 ships at member units.